ACCT 304 Week 3 DQ 2 Cash-Flow Statement

In this file of ACCT 304 Week 3 DQ 2 Cash-Flow Statement you will find the answer on:

The Statement of Cash Flows has historically given students a lot of heartburn, but it really isn't that scary. A cash-flow statement, simply stated, reports the uses (where the cash was spent) and the sources (where the cash came from) of cash during a period. Let's start with a very simplistic set of facts. I run a CPA firm, and I billed my clients $50K during the month of February. To earn that$50K, I incurred $20K of wage expense and another$10K of overhead (rent, utilities, insurance, etc.). So I made $20K profit, right? So I am sitting pretty? Not necessarily. What if I now tell you that$40K of my billings have yet to be collected? And my E&O insurance carrier increased my premium and I had to pre-pay $10K of premiums this month. How does my cash flow differ from my profit? Will these transactions appear on my income statement? My cash-flow statement? • Prof.Interior 1 orders completed$3.99